New gas tax formula to be phased in over time

Published: Tuesday, June 18, 2013 at 5:12 p.m.

Last Modified: Tuesday, June 18, 2013 at 5:12 p.m.

In an 11th-hour switch, the County Commission has agreed to let Marion County's cities keep more gas-tax cash — for the time being.

The board entered Tuesday's session prepared to adopt a plan that would have reset a 30-year-old formula for dividing gas tax revenues heavily in the county's favor.

Based on fiscal year 2012 revenues, the change would have cost the cities a combined $2.2 million in road maintenance funds.

The proposed change would have altered the formula for sharing proceeds from three separate gas taxes based on a state law that sets the distribution rates if the locals cannot work out their own deal. The state's formula runs according to what local governments actually spent on roads over the previous five years.

Such a deal was supposed to be backed by all involved as of June 1. That, however, never materialized.

Under the previous ratios set in 1983, the county gets 70 percent of the total distribution from the three taxes, while the city of Ocala receives 23.5 percent. Dunnellon and Belleview each take about 2.6 percent, while McIntosh and Reddick each get 0.6 percent.

Yet negotiations on Monday yielded a new plan that will phase in the reduction over the next three years.

According to that proposal, which the County Commission unanimously adopted, the cities in 2014 will keep 75 percent of the difference in revenues between the old rate and the new one.

In 2015, the return to the cities drops to 50 percent of the difference, then to 25 percent in 2016. After that, the county keeps it all.

But the County Commission will allow the cities to annually propose road projects whose cost may exceed their gas tax revenues.

Also at stake was a third tax that was enacted locally in 1989 that was divvied up according to the same method.

The county on Tuesday exercised its right to keep all of that money, projected in 2013 to be about $1.9 million, according to state figures.

The cities had advocated a "do no harm" approach.

Facing lean budgets, city officials wanted to keep the ratios the same or rework them based on other factors such as daytime population increases or miles of roads.

County officials, meanwhile, had countered that the unincorporated part of the community had absorbed the bulk of the population growth over the past three decades and the additional revenue was needed to keep up the roads.

Before the last-minute revised formula was announced at Tuesday's meeting, representatives of some cities urged the board to rethink the final outcome.

Ocala City Council President Mary Sue Rich went to the board on Tuesday to express the council's "disagreement and disappointment" with the County Commission's decision, coming as the cities were still "reeling" from the effects of the recession.

The cities would face "significant financial implications" if the change was made, Rich said.

She also noted that the city's population doubled during the day from workers and consumers coming into town, and that the city had agreed to maintain roads that are under the county's jurisdiction.

"Significant time and energy was invested in identifying alternatives that would meet all of the stated county goals," Rich added.

"Ultimately political decisions entail value judgments," she added. "The county's decision today will reflect the commission's value it places on its municipalities. Does the commission value the economic attributes of each municipality? Does the commission believe the municipalities serve as centers of commerce and hubs of economic activity? It would appear the answer is no."

Dunnellon Mayor Nathan Whitt added that the change would be a "death knell" for the cities.

Most of the policies involved no change in rates, and some did not affect taxpayers, since the full cost of the premiums are paid by the workers.

Yet Commissioner David Moore objected to a proposed change in employee health insurance that would have required staffers to pay more out-of-pocket costs for emergency room and diagnostic imaging services.

The county's willingness to pass along more costs to employees lowered Florida Blue's proposed rate hike from 18 percent to 12.5 percent.

Moore complained that the county should not be balancing its budget on the backs of the employees and argued for keeping the policy as is because experienced workers were leaving county government for other counties that offered better benefits.

The commission rejected that idea in a 4-1 vote, with Moore dissenting, after Risk Manager Sheri Wiley explained that doing so would add roughly $600,000 to a policy that was already going to cost taxpayers $16.3 million.

* Heard some trash talking by Tax Collector George "The Evil Taxman" Albright, who will grapple with Ocala's professional wrestling legend Dory Funk Jr. in a charity match on June 29.

To which Funk answered that Albright would have the shortest career in the history of wrestling.

The match, one of six scheduled for the event at the Ocala Hilton, including a women's world title bout, benefits Helping Hands of Ocala, a charity for abused and homeless women founded by Ocala developer Brad Dinkins.

<p>In an 11th-hour switch, the County Commission has agreed to let Marion County's cities keep more gas-tax cash — for the time being.</p><p>The board entered Tuesday's session prepared to adopt a plan that would have reset a 30-year-old formula for dividing gas tax revenues heavily in the county's favor.</p><p>Based on fiscal year 2012 revenues, the change would have cost the cities a combined $2.2 million in road maintenance funds.</p><p>The proposed change would have altered the formula for sharing proceeds from three separate gas taxes based on a state law that sets the distribution rates if the locals cannot work out their own deal. The state's formula runs according to what local governments actually spent on roads over the previous five years.</p><p>Such a deal was supposed to be backed by all involved as of June 1. That, however, never materialized.</p><p>Under the previous ratios set in 1983, the county gets 70 percent of the total distribution from the three taxes, while the city of Ocala receives 23.5 percent. Dunnellon and Belleview each take about 2.6 percent, while McIntosh and Reddick each get 0.6 percent.</p><p>The state-mandated disbursement plan would have changed that to provide Marion County 80.5 percent, Ocala 17.4 percent, Belleview 1.2 percent, Dunnellon 0.6 percent, McIntosh 0.2 percent and Reddick 0.1 percent.</p><p>Yet negotiations on Monday yielded a new plan that will phase in the reduction over the next three years.</p><p>According to that proposal, which the County Commission unanimously adopted, the cities in 2014 will keep 75 percent of the difference in revenues between the old rate and the new one.</p><p>In 2015, the return to the cities drops to 50 percent of the difference, then to 25 percent in 2016. After that, the county keeps it all.</p><p>But the County Commission will allow the cities to annually propose road projects whose cost may exceed their gas tax revenues.</p><p>Also at stake was a third tax that was enacted locally in 1989 that was divvied up according to the same method.</p><p>The county on Tuesday exercised its right to keep all of that money, projected in 2013 to be about $1.9 million, according to state figures.</p><p>The cities had advocated a "do no harm" approach.</p><p>Facing lean budgets, city officials wanted to keep the ratios the same or rework them based on other factors such as daytime population increases or miles of roads.</p><p>County officials, meanwhile, had countered that the unincorporated part of the community had absorbed the bulk of the population growth over the past three decades and the additional revenue was needed to keep up the roads.</p><p>Before the last-minute revised formula was announced at Tuesday's meeting, representatives of some cities urged the board to rethink the final outcome.</p><p>Ocala City Council President Mary Sue Rich went to the board on Tuesday to express the council's "disagreement and disappointment" with the County Commission's decision, coming as the cities were still "reeling" from the effects of the recession.</p><p>The cities would face "significant financial implications" if the change was made, Rich said.</p><p>She also noted that the city's population doubled during the day from workers and consumers coming into town, and that the city had agreed to maintain roads that are under the county's jurisdiction.</p><p>"Significant time and energy was invested in identifying alternatives that would meet all of the stated county goals," Rich added.</p><p>"Ultimately political decisions entail value judgments," she added. "The county's decision today will reflect the commission's value it places on its municipalities. Does the commission value the economic attributes of each municipality? Does the commission believe the municipalities serve as centers of commerce and hubs of economic activity? It would appear the answer is no."</p><p>Dunnellon Mayor Nathan Whitt added that the change would be a "death knell" for the cities.</p><p>"I implore you to look into a phased-in strategy," Whitt added.</p><p>In other action on Tuesday, the County Commission:</p><p><b>*</b> Approved new contracts to furnish health, life, vision, dental and long-term disability insurance to the county's 2,500-person workforce.</p><p>Most of the policies involved no change in rates, and some did not affect taxpayers, since the full cost of the premiums are paid by the workers.</p><p>Yet Commissioner David Moore objected to a proposed change in employee health insurance that would have required staffers to pay more out-of-pocket costs for emergency room and diagnostic imaging services.</p><p>The county's willingness to pass along more costs to employees lowered Florida Blue's proposed rate hike from 18 percent to 12.5 percent.</p><p>Moore complained that the county should not be balancing its budget on the backs of the employees and argued for keeping the policy as is because experienced workers were leaving county government for other counties that offered better benefits.</p><p>The commission rejected that idea in a 4-1 vote, with Moore dissenting, after Risk Manager Sheri Wiley explained that doing so would add roughly $600,000 to a policy that was already going to cost taxpayers $16.3 million.</p><p><b>*</b> Heard some trash talking by Tax Collector George "The Evil Taxman" Albright, who will grapple with Ocala's professional wrestling legend Dory Funk Jr. in a charity match on June 29.</p><p>Accompanied by his "manager," Ocala lawyer Jimmy Gooding, Albright told Funk, "You guys are going down, Dory."</p><p>"I'll see you in the ring," he added. "Bring the money."</p><p>To which Funk answered that Albright would have the shortest career in the history of wrestling.</p><p>The match, one of six scheduled for the event at the Ocala Hilton, including a women's world title bout, benefits Helping Hands of Ocala, a charity for abused and homeless women founded by Ocala developer Brad Dinkins.</p><p>For more information, visit www.helpinghandsocala.org.</p><p><i>Contact Bill Thompson at 867-4117 or at bill.thompson@starbanner.com.</i></p>